Birmingham city council is seeking to make £212m in savings in the next tax year alone. Photograph: Robert Hackett/Alamy

The UK's biggest local authority plans to cut more than 7,000 jobs as it faces what it called a "gargantuan challenge" to cut £300m from its spending over the next three years.

Birmingham city council said a total of 4,300 posts would be cut from its 19,000-strong workforce and 3,000 more would be transferred out of the council into a schools co-operative.

The announcement came as Eric Pickles, the communities secretary, was accused of imposing "draconian" restrictions on councils in a new code of conduct banning them from publishing their own newspapers more than four times a year. Pickles, who said the new code would bring "town hall Pravda printing presses to a grinding halt", has also ordered councillors not to spend money on lobbying and to refrain from making comments on "contentious areas of public policy".

Birmingham council said that its £300m savings would be front-loaded, meaning that it would need to find £212m – 71% of the total savings target – in the first year from April. Its business plan reveals there will be cuts in children's and youth services, social care for older people, and leisure centres, although spending will be relatively protected on child protection, an area where the council has came in for criticism in the wake of the Khyra Ishaq case last year.

Birmingham's are the latest in a series of cuts announced by UK authorities as they prepare budgets for the coming financial year. Last week, Manchester city council announced 2,000 job losses as it planned to save £109m. Local authorities in England must find savings of 27% over the next four years.

Birmingham is also losing millions of pounds in specialist deprivation grants scrapped by the government. It is the 10th most deprived local authority area in England.

Roger McKenzie, assistant general secretary of the Unison union said: "This is a disastrous day for the people of Birmingham. The cuts announced today [Friday] amount to social and economic vandalism and they threaten the economic viability and social fabric of our city."

But Paul Tilsley, deputy leader of the council, said: "This is not a slash-and-burn budget. Over the next 12 months in Birmingham there will be no library closures, no leisure centre closures, no public toilet closures. Streets will still be cleaned, they will be lit at night, rubbish will be cleared and children will go to school."

The council said that of the 7,300 figure, 1,807 council employees had taken voluntary redundancy and 1,500 more had opted to do so in the coming year. The authority has made 302 compulsory redundancies and is consulting on the rest.

Defending his new PR rules for councils, Pickles said they would "make it crystal clear that any blatant vanity PR or politicised advertising by councils using public funds is a breach of the code".

But the Conservative-led Local Government Association described the move as unnecessary and contrary to the localist philosophy to which the government claimed to be committed.

The code will come into force in spring, if approved by parliament. Councils who disregard it risk a referral to the auditor.

Councils have had to follow a publicity code since 1988 and the document was last amended in 2001. There are three key features in the new version:

•Councils can publish their own newspapers only four times a year. Pickles believes this will stop them providing unfair competition for commercial local newspapers. Parish councils will be allowed to publish newsletters monthly.

•Councils will not be allowed to hire lobbyists "for the purpose of the publication of any material designed to influence public officials, MPs, political parties or the government to take a particular view on any issue". Using publicity stalls at party conferences for policy lobbying will also be banned.

•All publicity must be "balanced and factually accurate" and avoid anything "likely to be perceived by readers as constituting a political statement, or being a commentary on contentious areas of public policy". Pickles has been angered by councils such as Lambeth, south London, which has run a poster campaign blaming the government for spending cuts.